The Federal Reserve decided Wednesday to lower its benchmark interest rate by a quarter point for a third time this year, but indicated future cuts will likely be halted barring a deterioration in economic conditions.
The Fed lowered its short-term lending rate to between 1.5% and 1.75% from 1.75% to 2%, citing a “moderate rate” of economic growth.
Jerome Powell, the Fed chair, told reporters after the body convened that the current rate is “appropriate,” but “if developments emerge that cause a material reassessment of our outlook, we would respond accordingly.”
“Policy is not on a preset course,” he said.
Wall Street was flat following the Fed’s announcement with the Dow up 0.3%, the S&P 500 and Nasdaq higher by 0.23% in late-afternoon trading.
U.S. President Donald Trump, who has called for the central bank to aggressively cut interest rates, has yet to weigh in on the decision. But he has been a striking critic of Powell’s, often blaming him for what Trump says is economic underperformance cause by the Fed’s light touch in approaching rate cuts.
In all, eight of the Fed’s 10 members voted in favor of the rate cut. Kansas City Fed chairwoman Esther George, and Boston Fed Chairman Eric Rosengren are the two dissenting members who wanted to leave rates unchanged.